Iron ore built BHP, and it still digs the stuff out cheaper than anyone else: seven years running as the lowest-cost major producer in the Pilbara, more than US$10 a tonne ahead of its nearest rival, and a record year of production behind it. In the year to June, copper overtook it. For the first time, the copper business earned more than everything else BHP mines put together.
Copper made a record US$18 billion before interest, tax and the wear on the machinery, keeping 70 cents of every dollar it brought in. That is the best margin anywhere in the group.
Across the whole company, earnings on that measure reached US$32.9 billion, a quarter more than the year before. Shareholders get US$8.7 billion for the year, the biggest payout in four years.
What the market did with it
The market took the point. BHP's shares hit a record on Monday and the value of its Johannesburg listing went through R4 trillion, up about half this year. The Australian line hit its own record a day later, at A$68.22.
The people paid to rate the stock are not joining in. Of the eleven brokers who have published since the results, one says buy and nine say hold. The eleventh moved to sell, with a target a fifth below where the shares are now, and every twelve-month target on the list already sits under the current price.
Where the next US$11 billion goes
Copper, mostly. BHP spent US$10.3 billion on building and exploring last year, and expects to spend about US$11 billion a year from here, more than half of it aimed at copper.
At Escondida in Chile, the biggest copper mine there is, a new concentrator is waiting on a final decision in 2027 or 2028. It would cost somewhere between US$5.4 billion and US$6.3 billion. The Vicuna venture with Lundin Mining, on the Argentina and Chile border, could reach its own first decision as early as the end of this year.
Not everything landed. A US$2.3 billion writedown on the Jansen potash project, taken because it is costing more to build than planned, pulled statutory profit down to US$9.8 billion, against underlying profit of US$13.2 billion.
